Jensen,Johnson,and Mercer showed that the relationship between stock returns and size and price-to-book ratio holds in periods when monetary policy is
A) Neutral.
B) Tight.
C) Easy.
D) All of the above.
E) None of the above.

Question

Quizplus · Accepted Answer

Jensen, Johnson, and Mercer found that the relationship between stock returns and size and price-to-book ratio is significant during periods when monetary policy is easy, meaning when interest rates are low and monetary conditions are accommodative.

Jensen,Johnson,and Mercer Showed That the Relationship Between Stock Returns and Size